FSB Urges Tough New Rules on 'Shadow Banks'

By

Geoffrey T. Smith

Updated Nov. 18, 2012 10:57 p.m. ET

The Financial Stability Board Sunday published recommendations for new regulations to contain the risks posed by the "shadow banking" sector.

"Shadow banking" refers to a whole range of activities that ultimately do the same thing as regulated banks—lending and borrowing money—but are structured so as to avoid the costs and scrutiny faced by the regulated banking system. Such activities have grown nearly...